Genetic variations are landmarks that allow us to track our genetic ancestry and their genome structure informs us about the molecular and demographic forces that have shaped it. For medical research the most important polymorphisms are disease-causing variants, but non-functional polymorphisms are also useful as markers for linkage and association studies. The detection of single-nucleotide polymorphisms (SNPs) and short insertion/deletions (INDELs) from DNA sequences is challenging because one must align and compare sequences from varied sources, and differentiate true polymorphisms from sequencing errors. There is a growing need to find rare, medically important alleles in deep alignments of clonal sequences and diploid sequence traces;to identify large numbers of markers for mapping studies in humans, model organisms, and plants;and to discover informative polymorphisms for pathogen strain identification. Building on our existing software, POLYBAYES, we propose to develop a general polymorphism discovery tool that meets these challenges. We will organize fragementary sequences by layering them upon the genome reference sequence;discard paralogous sequences from similar, duplicated genome regions;and use base quality values in a rigorous, Bayesian scheme to compare sequences of arbitrary quality standards. Specifically, we propose methods to align multi-exon genes, and novel methods for paralog filtering based either on complete mapping information or on genome distributions of sequence divergence. We will develop new algorithms for the difficult problem of INDEL detection;integrate heterozygote detection in diploid traces into our software;enhance sensitivity to detect rare alleles;and include a new measure to estimate the true positive rate of our candidate predictions. We will implement a fast, reliable, full functionality discovery tool that is free for academic research, performs well in large discovery projects, but can run on desktop computers, and is easily accessible to Biologists in small or medium laboratories.